MP3.COM Named Co-defendant in MP3 Lawsuit

MP3 software developer PlayMedia
Systems, Inc.Monday named MP3-related software Web site MP3.COM, Inc., as a co-defendant in its
lawsuit against Nullsoft, Inc., developer of the popular “Winamp” MP3
Internet music player.

PlayMedia seeks $15 million in damages from MP3.COM. The figure is based on
PlayMedia’s estimate of the number of allegedly infringing Winamp players
that MP3.COM distributed since April 1998.

PlayMedia says that MP3.COM is the largest redistributor of Nullsoft’s
Winamp, which contained Nitrane MP3 decoding engine. PlayMedia claims the
Nitrane decoder was derived from its own Audio MPEG Player (AMP) technology.
Nullsoft counterclaims that the technology was self-developed.

“This MP3.COM version of ‘Winamp’ was promoted and redistributed from
MP3.COM’s wholly-controlled
servers. We allege that these branded versions of ‘Winamp’ contained the
disputed
‘Nitrane’ engine until version 2.2 came out a few days ago,” said PlayMedia
co-founder and CEO Brian D. Litman.

“On the whole, I think we could credibly assert that MP3.COM built a
significant portion of its business by virtue of their massive distribution
of ‘Winamp.’ If, as we allege, the MP3 decoder in ‘Winamp’ infringed upon
PlayMedia’s software, then by logical extension, MP3.COM owes a heavy debt
to PlayMedia for our MP3 technology.”

PlayMedia filed a Federal copyright lawsuit March 15 seeking $20 million in
damages and a permanent injunction against Nullsoft, Inc. to prohibit
distribution of all versions of Winamp containing the Nitrane MP3 decoder or
player.

On May 3rd, Nullsoft released a second version of Winamp with a Fraunhoffer
MP3 decoder.

Playmedia won a preliminary injunction May 7.

Confirmation of the co-defendant move was made only days after MP3.COM
announced its IPO, set to raise $115 million.